"Manitoba's housing affordability saw a little bit of everything in the
second quarter with some modest improvement taking place for two-storey
homes and a slight deterioration for bungalows and condos," said Craig
Wright, senior vice-president and chief economist, RBC. "That said,
homebuyers in the province continue to face little undue pressure as
affordability levels remain very close to historical norms."

RBC notes that buyers became more active in the first half of 2015, with
home resales posting back-to-back quarterly increases and moving
slightly above their five-year average.

"A main challenge for the province continues to be the plentiful supply
of homes available for sale - many of them condos - in the Winnipeg
market, although the second quarter witnessed some improvement with new
listings falling modestly," said Wright. "Some of the recent absorption
issues in the condo market are a result of a wave of new multi-unit
completions in Winnipeg last year."

The RBC Housing Affordability measures, which capture the province's
proportion of pre-tax household income needed to service the costs of
owning a home at market values, were mixed in the second quarter of
2015. RBC's measures for Manitoba rose by 0.7 percentage points for
both bungalows and condos, to 36.3 per cent and to 22.9 per cent,
respectively (an increase in the measure represents a deterioration in
affordability). Two-storey homes saw a slight improvement in
affordability with a decrease in the measure of 0.5 percentage points
to 36.5 per cent.

During Q2 2015, national affordability measures rose by 0.7 percentage
points to 43.3 per cent for bungalows and by 0.4 percentage points to
48.3 per cent for two-storey homes. The measure for condominiums
remained unchanged at 27.1 per cent.

The RBC Housing Affordability measure, which has been compiled since
1985, is based on the costs of owning a detached bungalow (a reasonable
property benchmark for the housing market in Canada) at market value.
Alternative housing types are also presented, including a standard
two-storey home and a standard condominium apartment. The higher the
reading, the more difficult it is to afford a home at market values.
For example, an affordability reading of 50 per cent means that
homeownership costs, including mortgage payments, utilities and
property taxes, would take up 50 per cent of a typical household's
monthly pre-tax income.

It is important to note that RBC's measure is designed to gauge
ownership costs associated with buying a home at present market values.
It is not a representation of the actual costs incurred by current
owners, the vast majority of whom have bought in the past at
significantly different values than those prevailing in the latest
period.

Rapid home price increases in Vancouver significantly impacted housing
affordability in British Colombia in the second quarter. RBC's measures
for the province rose more than any other province, up 2.5 percentage
points for two-storey homes, 2.1 percentage points for bungalows, and
0.4 percentage points for condominiums.

Following the plunge in oil prices in the first quarter of 2015,
Alberta's housing market settled down in the second quarter. RBC's
measures for the province fell by 0.5 percentage points for two-storey
homes, 0.1 percentage points for bungalows, and inched higher by 0.2
percentage points for condominiums.

Signs of recovery in the home resale market were apparent in the second
quarter, although resale activity remained far below levels in 2014.
RBC's measures increased by 0.8 percentage points for both bungalows
and two-storey homes, while the measure for condominiums decreased by
0.2 percentage points.

Owning a single-detached home at market prices in the province has
become less and less affordable, while owning a condominium appears to
be within reach. RBC's measures showed further deterioration for
bungalows (rising by 1.1 percentage points) and two-storey homes (up
0.7 percentage points), while condominiums remain fairly steady (down
only 0.1 percentage points).

Housing affordability continued to improve in Quebec in Q2. RBC's
affordability measures fell in all three categories for the third
consecutive quarter and by some of the largest margins across all the
provinces. Two-storey homes fell by 1.1 percentage points, bungalows
fell by 0.9 percentage points, and condominiums decreased by 0.5
percentage points.

Softness in the housing market drove homeownership costs down in Q2.
RBC's affordability measures fell across all categories (between 0.3
and 0.7 percentage points), adding to the continuous decline registered
since late 2013.

The full RBC Housing Trends and Affordability report is available
online, as of 8:00 a.m. ET today, at rbc.com/economics/market.